Chinese Tech Stocks Surge After Alibaba’s Strong Earnings, Yen Weakens

(Bloomberg) – Chinese tech stocks are leading the rise in Asian markets following Alibaba Group Holding Ltd. (BABA) announcing its highest revenue growth rate in over a year, generating optimism in the sector. The Japanese yen has fallen beyond 150 per dollar.

Market Trends Following Alibaba’s Performance

Shares in Hong Kong and a broader Asian stocks index climbed significantly after Alibaba’s shares jumped nearly 11% post-earnings announcement. Japanese equities remained steady. Meanwhile, gold prices are maintaining near-record levels, and U.S. Treasuries showed little movement following a decline in American equities from their peak. Asian markets are poised for a sixth consecutive weekly gain, marking their longest winning streak in nearly a year.

Geopolitical Concerns Amid Positive Sentiment

Despite ongoing apprehension surrounding escalating geopolitical tensions and a growing tariff dispute, Alibaba and other Chinese technology stocks have benefitted from a recent surge in enthusiasm related to DeepSeek’s artificial intelligence model. This influx of worldwide investment has contributed to a remarkable $1.3 trillion rally in Chinese equities.

"My strong belief is that until China implements significant structural reforms, these growth surges will be fleeting," remarked Ron Temple, chief market strategist at Lazard Asset Management. "It’s beneficial to engage in trading during these rallies rather than hold onto them for the long term."

Alibaba’s Commitment to AI Innovations

Alibaba’s CEO, Eddie Wu, emphasized that the company’s primary focus is on the development of artificial general intelligence. "We are dedicated to creating models that push the limits of intelligence," he stated during a post-earnings investor call.

Industry experts speculate that Alibaba’s robust financial results adequately justify the recent shift of funds from concentrated U.S. tech investments towards Chinese AI companies. Chris Weston, head of research at Pepperstone Group in Melbourne, highlighted this trend.

Japanese Yen and Economic Indicators

In currency news, the yen weakened again in Friday trading after it briefly strengthened above the pivotal 150 mark on expectations of an impending interest rate hike from the Bank of Japan. Current market sentiment estimates nearly an 84% probability for a 25 basis point increase at the upcoming July meeting, compared to 70% at the beginning of the month, according to Bloomberg data.

Recent data also revealed that Japanese inflation exceeded expectations, with consumer prices excluding fresh food escalating by 3.2% year-over-year in January, marking the largest increase since June 2023. Japanese 10-year government bond futures continued to rise as BOJ Governor Kazuo Ueda addressed Parliament.

Rising Commodity Prices and Interest Rate Speculations

Oil is set to experience its largest weekly increase since early January amidst rising supply uncertainties. Gold remains close to record levels and is on track for its eighth consecutive weekly gain, driven by heightened demand for safe-haven assets amid geopolitical uncertainties and economic outlook concerns.

Upcoming Key Economic Releases

This week features pivotal economic reports, including:

• Eurozone HCOB manufacturing & services PMI (Friday)
• U.S. S&P Global manufacturing & services PMI, existing home sales, and consumer sentiment (Friday)

Market Summary Today:

Stocks

• S&P 500 futures show minimal change as of 11:38 a.m. Tokyo time.
• Japan’s Topix remained stable.
• Australia’s S&P/ASX 200 slipped by 0.2%.
• Hong Kong’s Hang Seng increased by 2.4%.
• The Shanghai Composite rose by 0.2%.

Currencies

• Bloomberg Dollar Spot Index increased by 0.1%.
• The euro remained steady at $1.0495.
• The Japanese yen fell by 0.7% to 150.64 per dollar.
• The offshore yuan decreased by 0.2% to 7.2479 per dollar.

Cryptocurrencies

• Bitcoin rose by 0.2% to $98,318.37.
• Ether increased by 0.5% to $2,740.07.

Bonds

• The yield on 10-year Treasuries declined by one basis point to 4.50%.
• Japan’s 10-year yield remained steady at 1.435%.
• Australia’s 10-year yield showed little variance at 4.52%.

This report was produced with the support of Bloomberg Automation, with contributions from Matthew Burgess and Joanne Wong.

©2025 Bloomberg L.P.

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